PM Justin Trudeau's Canada

[SunriseChampion]

Don't the major pizza chains have a special clause that allows them to buy American cheese? That probably partly explains why our chains make such bad pizza.

Indubitably.

If the market was opened the Canadian producers would be decimated. Most people probably don't look at the country of origin for products like milk .

Why would they be decimated exactly? Their (Canadian producers') product is better, for one. If American subsidies ceased, what advantage would their product have over ours?

 

[AlvinofDiaspar]

Indubitably.
Why would they be decimated exactly? Their (Canadian producers') product is better, for one. If American subsidies ceased, what advantage would their product have over ours?

Doesn't really matter -the Americans knew we had a supply management system prior to signing FTA/NAFTA - and at this point, we import far more milk from the US than we export to them. For them to kick up a fuzz now over this peanuts issue is just looking for an unconvincing pretext - like applying tariffs to steel and aluminum on the basis of "national security". Capitulation on this minor issue just invites further ludicrous demands for concessions while needless inflaming regional tensions within our country. Lose lose for us.

And consumers at large don't give two sh*ts about the cost of milk/dairy in Canada for it to be a true issue. It's not like it ate up 10% of household income or anything.

AoD

 

[SunriseChampion]

Oh no, I don't suggest we be rid of it for the Yanks' sake, but for our own.

 

[AlvinofDiaspar]

Oh no, I don't suggest we be rid of it for the Yanks' sake, but for our own.

Even then it is a non-issue - the overall impact on the average consumer is miniscule - there is no “sake” that really mattered, other than being a little OCD about principles that have far worse analogues elsewhere in the interprovincial trade system. There are far more important internal trade files (eg pipelines) than a sector that is fairly worthless to the overall economy but have an up-sized aggravation factor.

AoD

 

[lenaitch]

That might be thorny but it alone is no reason to continue with supply management ad infinitum. I'm sure they could be compensated. We have lots of money in this country. For example, enough to pay inflated prices for dairy, eggs, and poultry.

Fair point. "Thorny" doesn't necessarily imply showstopper. A big problem in any trade agreement with the US is that it seems the day after the ceremonial signing they start efforts to end-run it. The powerful industrial lobbies and, from our perspective, bizarre campaign funding, results in a dizzying array of federal/state/local "assistance" initiatives. Or, more recently, just call it 'national security. Whether it is state-state or investor-state, trade agreements with the US seem to be viewed by them as simply guidelines rather than rules.

It often seems like a Monty Python sketch. We subsidize Bombardier - but you subsidize Boeing. No we don't - yes you do - no we don't . . .

 

[AlvinofDiaspar]

Fair point. "Thorny" doesn't necessarily imply showstopper. A big problem in any trade agreement with the US is that it seems the day after the ceremonial signing they start efforts to end-run it. The powerful industrial lobbies and, from our perspective, bizarre campaign funding, results in a dizzying array of federal/state/local "assistance" initiatives. Or, more recently, just call it 'national security. Whether it is state-state or investor-state, trade agreements with the US seem to be viewed by them as simply guidelines rather than rules.

It often seems like a Monty Python sketch. We subsidize Bombardier - but you subsidize Boeing. No we don't - yes you do - no we don't . . .

Don't forget stumpage fees for softwood lumber - we're told we don't charge enough for a resource that grows on Crown land - and how the recently imposed US duties were basically used to prop up a mill.

AoD

 

[Northern Light]

Even then it is a non-issue - the overall impact on the average consumer is miniscule - there is no “sake” that really mattered, other than being a little OCD about principles that have far worse analogues elsewhere in the interprovincial trade system. There are far more important internal trade files (eg pipelines) than a sector that is fairly worthless to the overall economy but have an up-sized aggravation factor.

AoD

I'm essentially in agreement, particularly in the context of the way the US handles its dairy sector.

Worth noting is the near collapse of the Aussie dairy sector after it ended supply management.

****

But I will add I think it would behoove our sector to work at becoming more efficient so it would be better able to withstand more open markets in the future, as well as tackle the worst price discrepancies.

Which I think would be the organic sector; and certain imported European cheeses.

Reducing the 'excess' price by say 25% on their own would reduce the howls by some to end 'the system' while better positioning the industry for future competition.

 

[AlvinofDiaspar]

I'm essentially in agreement, particularly in the context of the way the US handles its dairy sector.

Worth noting is the near collapse of the Aussie dairy sector after it ended supply management.

****

But I will add I think it would behoove our sector to work at becoming more efficient so it would be better able to withstand more open markets in the future, as well as tackle the worst price discrepancies.

Which I think would be the organic sector; and certain imported European cheeses.

Reducing the 'excess' price by say 25% on their own would reduce the howls by some to end 'the system' while better positioning the industry for future competition.

I am totally for the idea of very gradually loosening the system - but having that conversation during a trade war is just a non-starter.

AoD

 

[SunriseChampion]

It often seems like a Monty Python sketch. We subsidize Bombardier - but you subsidize Boeing. No we don't - yes you do - no we don't . . .

I agree. It is some sort of comedy.

 

[SunriseChampion]

Worth noting is the near collapse of the Aussie dairy sector after it ended supply management.

I'm not familiar with this situation. Please enlighten me.
Don't tell me the Kiwis swooped all their business.

 

[pman]

I'm essentially in agreement, particularly in the context of the way the US handles its dairy sector.

Worth noting is the near collapse of the Aussie dairy sector after it ended supply management.

****

But I will add I think it would behoove our sector to work at becoming more efficient so it would be better able to withstand more open markets in the future, as well as tackle the worst price discrepancies.

Which I think would be the organic sector; and certain imported European cheeses.

Reducing the 'excess' price by say 25% on their own would reduce the howls by some to end 'the system' while better positioning the industry for future competition.

Re Australia, they also let their car industry collapse because it wasn’t competitive. And yet..their per capita GDP is around 25% greater than ours. If that’s just boring numbers to you I’d suggest flying the 25 hours or so to Sydney or Melbourne, because both cities make Toronto look shabby, poor and sad. Of course, the Australians do actually manage to transport natural gas to tidewater because they don’t have a Charter of Rights or an aboriginal veto on everything. They’ve specialized in what they do well, and they’re richer than us as a result.

 

[AlvinofDiaspar]

Re Australia, they also let their car industry collapse because it wasn’t competitive. And yet..their per capita GDP is around 25% greater than ours. If that’s just boring numbers to you I’d suggest flying the 25 hours or so to Sydney or Melbourne, because both cities make Toronto look shabby, poor and sad. Of course, the Australians do actually manage to transport natural gas to tidewater because they don’t have a Charter of Rights or an aboriginal veto on everything. They’ve specialized in what they do well, and they’re richer than us as a result.

Not anymore:

Their economy is driven even more heavily by commodities than ours - and the post 2010 divergence is the direct result of having high growth trading partners that are relatively immune to the 2008+ downturn.

AoD

 

[Northern Light]

I'm not familiar with this situation. Please enlighten me.
Don't tell me the Kiwis swooped all their business.

Not exactly.

A series of different issues, including Russia/Ukraine, the lifting of European dairy quotas, and perhaps most of all, the stock piling of milk powder by China caused a massive price collapse.

The way in which milk is paid for in Australia by producers causes a double-whammy in that price cuts were imposed AFTER milk had been produced or committed for sale as a result of the crisis, causing knock-on bankruptcies.

One reason for this is that in the early days after Aussie supply management ended, they ramped up production and export sales to China.

What the Chinese didn't mention was that they were stockpiling a lot of the product like a strategic reserve, allowing them to suddenly cut their orders on a whim.

http://www.abc.net.au/news/rural/2017-01-27/understanding-the-dairy-crisis/8184510

 

[Northern Light]

Re Australia, they also let their car industry collapse because it wasn’t competitive. And yet..their per capita GDP is around 25% greater than ours. If that’s just boring numbers to you I’d suggest flying the 25 hours or so to Sydney or Melbourne, because both cities make Toronto look shabby, poor and sad. Of course, the Australians do actually manage to transport natural gas to tidewater because they don’t have a Charter of Rights or an aboriginal veto on everything. They’ve specialized in what they do well, and they’re richer than us as a result.

Hmmm.

You got me researching.

My first thought was certainly that you could be right, in whole or in part, and I should look for causes.

That being the case, I considered two of my favourite subjects on Australia, the much higher minimum wage, and the mandate of at least 4 weeks paid vacation per annum.

My thought being both that this drives up income (and median income) and therefore consumer spending, but also that it drives investments in productivity.

For the above, note that the Aussie minimum wage as at July 1st this year is $18.93 AUS which is $18.61 CAD per hour. Compare that with our recent hike to $14, which only Ontario and AB are at, approximately.

The difference, interestingly is 32%, prior to the recent increase, the Aussie minimum wage was 63% higher than Ontario's.

I think that lends some credence to my theory.

But that got me thinking.

Part of that GDP is driven by higher incomes and that in turn requires higher prices to finance those incomes, which means a dollar doesn't go as far in daily life.

So instead of comparing the GDP per capita 'raw', how about comparing it on a PPP (purchasing power parity) basis.

Thankfully someone did that math for me.

Based on the IMF calculation: Australia would be #18 in the world at $49,882 INT $ per capita, Canada would be #22, at $48,141 INT $ per capita..

This does leave Australia a tad ahead, but only by 3.6% not 25%

https://en.wikipedia.org/wiki/List_of_countries_by_GDP_(PPP)_per_capita

The rest I think we can set aside.

 

[pman]

Hmmm.

You got me researching.

My first thought was certainly that you could be right, in whole or in part, and I should look for causes.

That being the case, I considered two of my favourite subjects on Australia, the much higher minimum wage, and the mandate of at least 4 weeks paid vacation per annum.

My thought being both that this drives up income (and median income) and therefore consumer spending, but also that it drives investments in productivity.

For the above, note that the Aussie minimum wage as at July 1st this year is $18.93 AUS which is $18.61 CAD per hour. Compare that with our recent hike to $14, which only Ontario and AB are at, approximately.

The difference, interestingly is 32%, prior to the recent increase, the Aussie minimum wage was 63% higher than Ontario's.

I think that lends some credence to my theory.

But that got me thinking.

Part of that GDP is driven by higher incomes and that in turn requires higher prices to finance those incomes, which means a dollar doesn't go as far in daily life.

So instead of comparing the GDP per capita 'raw', how about comparing it on a PPP (purchasing power parity) basis.

Thankfully someone did that math for me.

Based on the IMF calculation: Australia would be #18 in the world at $49,882 INT $ per capita, Canada would be #22, at $48,141 INT $ per capita..

This does leave Australia a tad ahead, but only by 3.6% not 25%

https://en.wikipedia.org/wiki/List_of_countries_by_GDP_(PPP)_per_capita

The rest I think we can set aside.

You’re right. Almost everything is more expensive there.